Thinking about retirement savings often brings a mix of excitement and anxiety. Everyone has an idea of how much they might need, but reality often tells a different story. Let’s unpack what people think they need versus what they actually save, and how you can get closer to your dream retirement.

Here’s a simpler take on navigating this critical topic:

  1. The Savings Gap: Many people believe they’ll need around $1.27 million to retire comfortably.1 However, the amount the average couple is saving can be a wake-up call. For instance, people in their 40s typically have around $77,400 saved, far less than the million-plus they envision needing.
  2. Planning for Longer Life: With folks living longer, your retirement savings might need to last 20-30 years. It’s critical to think about how much you really need to support your lifestyle without running out of money.
  3. What’s Your Retirement Look Like?: Imagine your ideal retirement. Whether it’s traveling, enjoying hobbies, or spending time with family, understanding what you want to do helps you figure out how much it might cost. Then, you can start planning how to save that amount.
  4. Balancing Act: How you save and when you plan to retire can significantly impact your finances. If you’re looking at retiring sooner, you might need to save more aggressively or adjust your spending habits.
  5. Tax Smarts: Knowing how to manage your money can make a big difference. For example, understanding the tax implications of withdrawing from retirement accounts like 401(k)s or IRAs at different times can help you keep more of your money in your pocket and give less to the IRS.
  6. Social Security Strategy: Don’t forget about your Social Security benefits. While not enough to fund retirement alone, when taken at the right time, it can complement your savings well. For some, starting benefits early makes sense, while others might benefit from waiting to maximize their monthly checks.
  7. Reality of Savings: Reality often doesn’t match expectations when it comes to retirement savings. It’s common to find that you’re not as prepared as you thought. Acknowledging this can be the first step to adjusting your savings strategy.
  8. Asking for Help: If you’re unsure about how to prepare for retirement or how to handle the savings gap, talking to a financial advisor can be a great move. They can help you create a plan that makes sense for your personal financial situation and retirement goals.

Retirement planning isn’t just about stashing away money. It’s about making smart choices now so your golden years can be as enjoyable as you hope. It’s never too late to start or refine your strategy to make the most of your retirement savings.

If you want to discuss your specific situation, don’t hesitate to call our office at (435)773-9444 or click here to schedule a time to sit down with one of our Financial Architects. We’re here to help guide you through the complexities of retirement savings and ensure you’re on the right track to meet your retirement goals.


Sources:

  1. Newsroom | Northwestern Mutual – Planning & Progress Study 2023